The idea behind payday loans is that they are for short-term borrowing. This is because they are expensive and the interest rate is much higher. It is also extremely important that you fully understand the interest costs and other charges before you take out the loan.

Choosing a Loan

Choosing the right popular loan is about getting the best value for money but is also about getting the right company and terms for you. You can see any amount of adverts telling you which loan to choose but we believe the best way is to give you the information and let you choose for yourself.

Basics

The idea behind popular loans is that you can get a small amount of money lent to you from a source that isn’t a bank. It is quicker to borrow money from these outlets but the interest rate is a lot higher. This is because you pay the money back over a short period of time, usually 30 days, instead of a number of years as you do with a bank loan.

What to consider

The most important thing to think about before taking a popular loan is how you are going to pay it back. Never take a loan and hope you can pay it back – this can be expensive, end up costing you more money than originally quoted and effect your credit record.

Secondly, you want to know that the company you get your loan from are reputable and reliable. You want a company that gives you all the necessary information upfront and sticks to what it says it will do. You should always be told how much you will pay back, what happens if you don’t pay it back when due and what you will be charged if you don’t pay it back when due.

Under new regulations, the lender should let you know that this option is not a replacement for a long-term loan and late repayment of the money can lead to serious financial difficulties. They should also explain something called Continuous Payment Authority (CPA) and how this works and can be stopped.

How to pay back the popular loan

Normally, the loan period will be 30 days and you have until the end of that period to pay it back. The amount you pay back will be what you borrowed plus the interest you were informed about when taking out the loan. Most people use a debit card to do this but when a CPA is in place, the lender can take the money straight from your bank account. If this happens and you don’t have the money in, you can be charged by the bank.

To stop this in the event of a problem, you need to contact your bank but you also need to inform the lender. Usually the cut-off point will be the day before to stop a CPA and you will need to make an arrangement with the loan company to pay the money back.

Can loans be extended?

If you think you aren’t going to be able to pay back the loan on the due date, you should contact your lender. They may agree to extend the loan period or roll over the loan into a new period entirely. Rolling over loans means you are taking out another loan with a new due date so be aware of this but also that there will now be more interest due than originally. Most lenders won’t let you use this facility more than twice due to new regulation.

Lenders will also provide you with information about how to get help and advice if you are in financial difficulties.

Can you get a loan with bad credit?

With popular loans, a bad credit record isn’t as much of an issue as with many traditional loans. Mostly the lender will look at whether you have the ability to repay the loan – such as regular income – rather than just a credit scoring system. In some cases, taking out and paying off small loans can help build up your credit rating as it shows managing money and paying off debts. This is not to say we recommend doing it for this reason.

Conclusion

There are lots of companies providing loans but here we monitor not only the deals offered by these companies but the standards they are maintaining. There are companies for those with bad credit records and some who give a better rate once you prove you can pay back the loan. But whatever the reason or the type of popular loan you looking for, always make sure you can pay it back on time.

All Popular Lenders

Cred24 mission is to help people save money and time in moments when they need fast financial support. Our team analyses payday loan offers every day to give you only the most viable and customer safe options.